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HomeMy WebLinkAboutItem 09 - Fiscal Year 2022-23 General Fund Results Finance and Management Services www.santa-ana.org/finance Item # 9 City of Santa Ana 20 Civic Center Plaza, Santa Ana, CA 92701 Staff Report December 19, 2023 TOPIC: Fiscal Year 2022-23 General Fund Results AGENDA TITLE Fiscal Year 2022-23 General Fund Results RECOMMENDED ACTION 1. Receive and file this informational report. 2. Approve proposed General Fund appropriation adjustment of $350,000 for non-departmental litigation. (Requires five affirmative votes) GOVERNMENT CODE §84308 APPLIES: No DISCUSSION The independent auditors have completed their fieldwork for the fiscal year ended June 30, 2023 and the City expects to issue its financial statements in December 2023. Staff plans to provide the City Council with an informational staff report covering the audited financial statements and related reports after the New Year. The purpose of this report is to provide early information regarding General Fund performance in FY 2022-23 and to request two appropriation adjustments. On November 7, staff reported that for FY 2022-23, the City received revenue in excess of estimates and had expenditure savings; and in December, staff would be able to identify the increase of the General Fund balance available for one-time spending, based on the positive FY 2022-23 variances. FY 2022-23 General Fund Results These positive variances have resulted in an estimated spendable General Fund balance of $17.8 million. The spendable amount is in excess of the 18% General Fund Reserve balance of $72.1 million. Although many of our General Fund revenues exceeded the conservative estimates and all departments had expenditure savings, the most significant contributors to the $17.8 million spendable balance follow. •Rising interest rates leading to increased investment income of more than $1 million in excess of the adjusted budget of $5 million as presented with the Third Quarter Report on May 16, 2023. Fiscal Year 2022-23 General Fund Results December 19, 2023 Page 2 3 9 3 2 •Increased federal reimbursement rates for emergency medical transports generated additional revenue of $0.8 million more than the adjustment made with the Third Quarter Report. •More than $2 million in collections of delinquent adult-use Cannabis business tax and hotel visitor’s tax. •The Business Tax holiday resulting in increased compliance generated more than $1 million of additional revenue. •One-time rebates for LED lights of nearly $1 million. •Staffing vacancies across all departments, which helped fund compensation increases negotiated with the bargaining groups. Therefore, the Non-Departmental section of the budget had $2.7 million of savings from the $5 million set aside for labor negotiations. The Police Department had additional vacancy savings of $2 million. •Once again, the Vehicle Incentive Program to rebate Measure X tax to residents purchasing a vehicle in Santa Ana had budgetary savings. The budget included $1.7 million for this program, and used less than $0.7 million. Requested FY 2023-24 Appropriations As reported on November 21, the City Attorney’s Office has a litigation budget of $600,000 yet has contracted outside legal service needs of $950,000 for FY 2023-24. Therefore, staff requests an appropriation adjustment of $350,000 for non-departmental litigation. In addition to the proposed $350,000 appropriation in this staff report, Public Works has a separate staff report on this same agenda for Engineering Division Funding. The Public Works staff report includes a recommended appropriation for $2.9 million from the General Fund balance available for spending. The following table includes both proposed appropriations totaling $3,250,000 and an updated summary of the General Fund budget for the current fiscal year. Fiscal Year 2022-23 General Fund Results December 19, 2023 Page 3 3 9 3 2 FISCAL IMPACT If the City Council approves the staff recommendation in both staff reports, the remaining estimated General Fund balance available for one-time spending will be $14,644,472. Staff expects to prepare recommendations for this one-time funding source for City Council consideration during the FY 2024-25 budget process. Staff recommends the following Appropriation Adjustments: Submitted By: Kathryn Downs, FMSA Executive Director Approved By: Tom Hatch, Interim City Manager FY2023-24 General Fund Summary FY23-24 1st Quarter Budget Update FY22-23 Year- End Adjustments Proposed D ecember 19 Adjustments Updated Estimate Esti mated Beginning Balance at July 1, 2023 109,372,864 17,835,714 127,208,578 Revenue Estimate 400,408,670 400,408,670 Appropri ated Spending (413,614,484)(3,250,000)(416,864,484) Pensi on Trust Set Aside (24,034,731)(24,034,731) Esti mated Ending Balance at June 30, 2024 72,132,319 17,835,714 (3,250,000)86,718,033 Less: 18% Reserve 72,073,561 72,073,561 Esti mated Spendable Balance 58,758 17,835,714 (3,250,000)14,644,472 Fiscal Year Accounting Unit – Account # Fund Description Accounting Unit, Account Description Amount FY23-24 01105015-62300 General Fund General Non- Departmental, Contract Services $350,000